Bluetooth Applications
presumably the sales) of these units, which will be able
to provide optimized routing to the user, taking actual
55% in 2010
travel times into account. As a result, many companies
(Airsage, Calmar, Inrix, Speedinfo,
Traffic.com, Traffic-
50%
44% in2010
Cast International, Cellint, ITIS Holdings, to name just a
40%
few) are offering travel time information in electronic
formats for use in these devices. They are also offering
30%
this information to public agencies and the media for
22% in ‘99
20%
their own traveler information and traffic management
16% in ‘97
applications.
10%
6% in ‘90
Booming market
It goes without saying that the collection of real-time
1995 2000 2005 2010
1990
Year
travel time data for all the major roadways of North
America can be an expensive undertaking. It was not
Figure 1. Freeway Surveillance Deployment History
until the advent of inexpensive navigation devices of the
type offered by Garmin, Magellan, TomTom and
location-equipped cell phones that the market has
grown to a size that is adequate to support this invest-
ment. An order of magnitude estimate of the market size
can be developed using available sales data for naviga-
tion devices.
Based on second quarter 2008 shipments of personal
navigation devices (PNDs) of 3.7m, sales in the US is
estimated to be 14m units per year. In addition, IT Facts
estimates that the number of cell phones sold in the US
with personal navigation solutions will be as much as
12m units by 2009. This represents a relatively modest
share of the 120m cell phones that are sold each year in
the US, and for this reason, the cell phone segment of the
personal navigation market can be expected to experi-
ence significant future growth. Thus annual sales of nav-
igation equipped devices (PNDs and cell phones) will
Figure 2. Traffax Bluetooth and GPS Receiver Electronics
reach 25m per year by 2009. This represents a rapidly
increasing market for the traffic data that can potentially able to collect traffic data using relatively inexpensive
be displayed on these devices, or used to support technologies. It is also significant that the size of this
sophisticated travel time-based routing algorithms. The private sector market significantly exceeds the total
cost of live traffic services is projected to be between public sector expenditures in ITS which have been esti-
US$10 and US$15 per month. mated to be less than US$750m per year.
Assuming 10 per cent of PND and cell phone custom- The success of this business model is dependent on
ers elect to purchase these services, at a cost of US$120 the cost and capabilities of the technologies being
per month, the annual sales for these services is likely to employed. Two technologies are in predominant use;
increase at a rate of US$300m (25m units x US$120 per cellular geolocation and tracking of GPS equipped
year x 10 pe cent) per year. Note that this is considered vehicles.
a market growth estimate (increase in sales) rather than Airsage, Cellint and ITIS Holdings use cell phone
an estimate of absolute market size because the 25m geolocation as the primary source of traffic data. This
units sold in the near future will be devices with new technology offers the large sample sizes required for
capabilities presumably purchased by new customers. reliable estimation of traffic speeds and travel times. Its
Within the next two to three years, this growth is likely to accuracy and coverage depends on the methodologies
stabilize as purchases of new units by new customers used for translating the characteristics of the cellular
levels off. communications into vehicle location (and in some
However, assuming three years of healthy growth, this cases direct measurement of speeds).
could become a US$1billion per year market, certainly Unfortunately, one of the primary disadvantages of
a business of adequate size to attract investment in this technology is that, in most cases, it requires the
nationwide infrastructure. This estimate does not take cooperation of a cellular telephone carrier. This coop-
into account the revenue potential of data purchases by eration has been difficult to obtain due to the relative
public sector agencies and the media. small size of the geolocation market in comparison with
the other services being addressed by these carriers.
Coming attractions As a result, none of the cellular geolocation companies
While there are many assumptions in this calculation, has been able to successfully establish nationwide cov-
this is clearly an attractive market to companies that are erage based on this technology.
36 Vol 4 No 1 Thinking Highways
www.thinkinghighways.com
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